The NAB Rural Commodities Index continued its upwards momentum and increased 1.4% month-on-month in May. The index is around levels seen in February 2023.
Report
March 25, 2024
NAB Rural Commodities Wrap: March 2024
The NAB Rural Commodities Index increased for the fourth month in a row in February . The index increased 2.2% month on month, and is back around levels last seen in April 2023.
Cattle prices were again the main driver of the monthly increase and are now around 80% higher than their October lows. Prices were supported by improved producer sentiment and strong export demand but slipped towards the end of the month as saleyard supply increased. Prices for rice, cotton, pork, dairy and fruit and vegetables also recorded increases in the month. Prices for winter crops continued their downward trend on the back of high global supply and subdued demand.
Conditions were relatively warm in the month and the BoM recorded the fourth warmest February since observations began. Rainfall was around the historic average.
Seasonal conditions are expected to be relatively dry over the coming few months, and rainfall is forecast to be below the historic median across most of the country. Models indicate that El Nino is ongoing but weakened, and ENSO levels will likely return to neutral around the end of April. Some models are predicting a return to La Nina by late winter, but model accuracy predicting events so far into the future is generally low.
